Purchasing cheap properties with unfixable issues for cash flow

[Steve R.]

Hi BP! I have been going back and forth over this issue.

I am currently looking at a 3/2 SFR in a decent neighborhood that that I can pick up very cheap but it has sloping floors. It sits on post and piers with a crawl space. The house has been there a long time and I don't think it will move much any more. I can purchase and do a light rehab for 20k but I would not be fixing the sloping floors besides trying to jack up here and there in the crawl space. I should be able to rent it for 650-700 a month which would generate around 375-400 in cash flow or I could sell it right away contract for deed without putting much into it for 30K.

What do you guys think? 

[James DeRoest]

Buy it. It's really not that difficult to fix sloping floors, just go slowly. Use a laser level to work out what needs jacking and by how far, then spend a week or two getting under the house and getting the house level again.

Professionally done you are talking thousands of dollars, do it yourself and you are talking peanuts, maybe a couple of hundred in new adjustable pillars.

This is the sort of thing that puts people off, and it's why people pay professionals. It's also how to buy a house cheap, level it up yourself and have a very nice asset when you're done.

I love jobs like these, and I know it's been serious structural issues that have got us some of the best deals over the years. This stuff scares people away for no real reason, just got to get a bit dirty.